"A string of deadly coal mining accidents around the world that have forced production cutbacks and prompted crackdowns on safety standards will constrain supplies and could lead to sharply higher prices for some types of coal."

Sunday, June 27, 2010

Collapse — The Movie

I was finally able to view a DVD of Collapse, an unusual documentary that is mostly a monologue by Michael C. Ruppert. After watching the film, viewers can probably be roughly divided into two groups: Those who will dismiss Ruppert as a crackpot, and those who will feel as if they’ve been guided into a whole new — and very scary — world. But if you listen objectively to what Ruppert has to say, you’ll likely avoid falling into the first group.

Let me be honest and say right from the outset that I have been a fan of Mike Ruppert and his work since the days when he was publishing From the Wilderness. I spent many hours slogging through his monumental tome Crossing the Rubicon. And now I’m on his lifeboat-building island CollapseNet. So it could be said that I am partial. Yet, anyone who has examined Ruppert’s writing cannot help but marvel at his thorough work, the logic of his dot-connecting, and his uncanny ability to peel away layers of obfuscation, spin, disinformation, and BS to ferret out the truth — a talent I call his “detective’s eye.” And his journalistic record speaks for itself. One wonders why all journalism cannot be like that at FTW. But of course we know the reason.

Collapse presents what many would call an apocalyptic vision — nothing less than the collapse of industrial civilization — in a surprisingly toned-down, low-key format. Despite presenting us with a quite horrifying scenario, we see Ruppert relaxing calmly in a chair, clad in a dress shirt and slacks, quietly and methodically laying out his case. The eerie bunker-like location contrasts with this, and serves to set off the message.

Naturally, many viewers will not or cannot believe that industrial civilization is on the road to ruin, or that mass starvation awaits the world’s oil-fattened population. In this respect, the kicker is the must-see update included on the DVD, in which Ruppert points out matter-of-factly that half the things he predicted in the film have already come to pass in such a short time. As such, that strongly suggests that he is right about the rest.

I for one wasn’t really surprised by what I saw because I’m so familiar with Ruppert’s work and thought. But to people for whom this film is their first encounter with ideas such as peak oil, the pyramid-scheme economy, and the decline of industrial civilization, the experience could leave them with serious doubts at the least, but more likely with brutally shattered perceptions, and even some sleepless nights. After all, people around the world are led to believe in infinite growth, ever-increasing prosperity, easy golden years on fat pensions, and a glorious technological future in which robots perform all menial work. But Ruppert is showing us that our comfortable world is based on lies and is already coming apart at the seams.

We also learn about Mike Ruppert the man, about what makes him tick. While the film and the deleted scenes offer a number of windows into his complex character, the one thing that stands out is his dogged pursuit of the truth. Ruppert has lived a somewhat dangerous life. For example, he’s been shot at, his office was once targeted with microwaves, and he once entered his office one morning to find all his computers smashed (if that isn’t a message, I don’t know what is). So it was no surprise that he “retired” for a while. Most people would have gotten out of the truth-seeking business long before that. But here’s a man who can’t stay away from his calling, so he’s now lecturing, doing interviews, and presiding over CollapseNet.

A criticism of the film is that it doesn’t offer much in the way of an Rx. Happily, this has been more than remedied by CollapseNet, a community where people can share information, skills, and wisdom, and help each other build lifeboats. Whereas Collapse is arguably dark, CollapseNet shines a ray of light and offers hope.

Certainly Collapse isn’t for everyone. If you want to believe that our feckless world leaders are going to pull the fat out of the fire and the good times are going to roll again, and you’re not ready to hear otherwise, then perhaps this movie isn’t for you. But if you’re ready to have your worldview severely challenged, I recommend it highly.

Monday, June 21, 2010

Pyramid-Scheme Economy

I’m of course not the first to say that the “growth economy” is very much like a giant pyramid scheme (so are pension programs, but that’s another story). And I’m also not an economics expert, but I can see three main engines that have so far kept the scheme going.

Just as you need to keep bringing in more people/money to maintain a pyramid scheme (which of course will inevitably crash), constantly increasing inputs are needed to maintain the infinite-growth economy — which of course will inevitably crash for the same simple reason: infinite growth is impossible.

First, you have to keep more people and their money coming into the system. These people become the “consumers” and “taxpayers” who keep buying stuff and paying taxes. Their consuming and taxpaying pump up the financial and commercial systems, and keep tax revenues flowing. Taxes allow governments, both local and national, to keep growing in size and complexity, providing more “services,” and building more infrastructure. Cities keep ballooning, suburbs are created and grow, more malls and factories are built, and more farms and forests are razed to make room for all of this. Such activities are now slowing, and you can see the devastating effects.

I remember when I was a kid, people were saying how much money could be made if we could just sell an aspirin to each Chinese. Visions of bringing more new consumers into the scheme are nothing new. Now of course everyone is excited to the point of orgasm because all those Chinese and Indians are eager to join the scheme and get their payoffs, too.

Second, the system needs to be fueled with cheap and plentiful energy. Oil has been the Great Provider in this area, with coal and natural gas also playing big roles. Now that oil is lagging in this respect, there are great hopes that coal, natural gas, and renewables will take up the slack. But if oil gets more expensive, everything gets more expensive. The days of cheap and plentiful energy are coming to a close.

Third, the system requires debt. Lots of it. Especially because the energy engine has begun to sputter, we’ve been trying to pick up the slack with debt. And we’re all up to our eyeballs in it — individuals, businesses, governments. Debt’s running out our ears. The cool thing about debt — in terms of the pyramid-scheme infinite-growth economy — is that it allows us to vastly accelerate the consumption of resources and energy. For example, many of us Little People would ordinarily not be able to buy big-ticket items like houses and new cars. And many of us even borrow to buy cheaper consumer goods. Using debt allows us to access resources and energy that would ordinarily be used by future generations, little by little. Of course it’s not just individuals, because businesses and governments also make heavy use of debt for their day-to-day operations. After all, stocks and bonds are ways of borrowing money, and borrowed money is debt. Using credit cards (which should actually be called “debt cards”) creates debt. So you can easily imagine that the world would be a much different place without debt. It certainly would crimp the infinite-growth economy.

That should make it pretty clear why the economy, shall we say, lacks vitality. There are still lots of people who want to join the scheme, but the other two factors — energy and debt — are dragging on the system because the world has entered energy decline, and because the system is saturated with debt. If there were still lots of cheap energy, it might be possible to goose the system and keep it going for a while longer, but it appears to be too late for that.

Finally, anyone interested in reading more about the energy-debt problem is encouraged to head on over to The Oil Drum and read some of the posts by Gail the Actuary, who’s done some excellent work in this area.